A BILL TO AMEND THE SOUTH CAROLINA CODE OF LAWS SO AS TO ENACT THE "ELIMINATE THE MARRIAGE TAX PENALTY ACT" BY ADDING SECTION 12-6-525 SO AS TO ALLOW MARRIED TAXPAYERS WHO FILE A JOINT FEDERAL RETURN TO CALCULATE THEIR AMOUNT OF SOUTH CAROLINA INCOME TAX OWED FOR THE TAX YEAR AS THOUGH EACH TAXPAYER FILED A RETURN AS A SINGLE TAXPAYER IF THE TAXPAYERS' CUMULATIVE TAX OWED WOULD BE LESS THAN THE AMOUNT THEY WOULD OWE HAD THEY FILED A JOINT RETURN.
Summary
H3365, titled the “Eliminate the Marriage Tax Penalty Act,” would amend South Carolina income tax law to give married taxpayers who file a joint federal return a new way to compute their state income tax. Under the bill, each spouse could calculate South Carolina tax as if filing separately as a single taxpayer, and if that method produces a lower combined tax than a standard joint calculation, the lower amount would be used to reduce the tax owed on the joint return.
The bill does not change the filing status available for South Carolina returns; married couples filing jointly for federal purposes would still not be allowed to file a South Carolina return under a different filing status. The Department of Revenue would be authorized to adopt rules and regulations to carry out the new provision, and the change would apply beginning with tax years after 2024, upon gubernatorial approval.
Impact
H3365 would add new Section 12-6-525 to Title 12, Chapter 6 of the South Carolina Code, creating a state income tax calculation option for married joint filers. Its practical effect would be to reduce state income tax liability for some married couples whose combined tax under separate-single calculations is lower than under the existing joint-return method, thereby partially addressing the so-called marriage tax penalty. The bill would affect married taxpayers filing joint federal returns and would require administrative implementation by the South Carolina Department of Revenue.
Sentiment
Based on the bill text and the absence of recorded committee transcripts or votes, the available context suggests the bill is presented in a favorable, policy-driven manner aimed at tax relief for married couples. The title and structure frame the measure as a corrective to an existing tax burden rather than a broad tax overhaul. No recorded opposition, amendments, or vote history is available in the provided materials.
Contention
The main policy issue is whether South Carolina should allow married joint filers to use a separate-single tax computation to lower their state tax bill. Supporters would likely view the bill as reducing an inequity for married couples and lowering taxes for some households, while potential critics could argue it creates a special preference for married taxpayers, complicates tax administration, or reduces state revenue. The bill also preserves joint filing status, which may limit concerns about broader filing-status changes, but the revenue impact and fairness implications remain the central points of debate.
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A BILL TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION 12-6-525 SO AS TO ALLOW MARRIED TAXPAYERS WHO FILE A JOINT FEDERAL RETURN TO CALCULATE THEIR AMOUNT OF SOUTH CAROLINA INCOME TAX OWED FOR THE TAX YEAR AS THOUGH EACH TAXPAYER FILED A RETURN AS A SINGLE TAXPAYER IF THE TAXPAYERS' CUMULATIVE TAX OWED WOULD BE LESS THAN THE AMOUNT THEY WOULD OWE HAD THEY FILED A JOINT RETURN.